Usability Drives Profitability

Transcription

1 Usability Drives Profitability Manufacturers look to user-friendly ERP systems to support business improvement and profitability. anufacturers want better enterprise resource planning (ERP) usability. The M complexities of modern production systems, improvement methodologies, and global supply chains beg for ERP that is accessible throughout an organization. Employees at all levels need easily implemented, scalable, and self-maintaining user tools that enable rapid, data-based decisions that move the company closer to strategic goals. Unfortunately, many older ERP systems weren t designed to provide wide and deep engagement. For all the power that still resides in these systems, they leave many users without the information and tools they need. At best, legacy ERP systems are only marginally effective in today s turbulent economic times, writes enterprise software strategist Louis Columbus. Agility, responsiveness, speed, and the ability-to-scale strategies galvanized around meeting and beating customer expectations require a new approach to how ERP systems are designed, implemented, and used. 2 New Plants, Changing Needs In yesterday s plants, machinery, information technology (IT) systems, and operators digitally spoke to one another via one-way conversations with unique purposes (i.e., process control, warehouse tracking, equipment maintenance, materials replenishment). Early ERP systems offered adequate planning in this environment, but their passive nature is out of sync with today s plants, which are designed for rapid execution and adoption of improvements in both products and processes. In fact, 82% of manufacturing plants now have some form of improvement methodology in place (59% identify lean manufacturing as one of their methods). More than two-thirds of manufacturers report at least moderate depth and breadth in applying their improvement approach. In addition, 69% report the presence of a continuous improvement (CI) program. 2 Early ERP systems offered adequate planning in this environment, but their passive nature is out of sync with today s plants, which are designed for rapid execution and adoption of improvements in both products and processes. 1 Columbus, Louis, The Days Of Brute Force ERP Are Over, Forbes.com, Dec. 27, MPI Manufacturing Study, The MPI Group The MPI Group. Usability Drives Profitability / The MPI Group 1

2 Unfortunately, 70% of manufacturers have, at best, only occasional capture of operations knowledge/ experiences, such as process improvements, that can be used to improve operations. These widespread improvement efforts mean that across the industrial sector, thousands of employees are seeking data to support their CI efforts. In facilities with aging ERP systems, this information can be hard to find if it s available at all. But companies with modern, usable ERP foster proactive problem-solving by enabling: Earlier capture of production gains through ease-of-use: The sooner operators are proficient with enterprise software, the sooner they make better decisions to improve plantfloor productivity. Easier cross-training on tasks and functions: Employees become more valuable because they can cover absences and keep production running to plan. Everyone becomes a starter, and no one sits the bench. Rapid employee access to vital data: Role-based IT tools drive users to critical knowledge and facts, which ensures accuracy in decision-making. And, when there is no right answer, operators have the knowledge to choose the best answer. Improving ERP system usability on the shop floor improves cycle time reductions, reduces order rework, improves quality management, and leads to greater production yields, adds Columbus. When production team members on a plant floor can measure and see how their work meets and exceeds customer expectations, engagement and quality both tend to go up. Better ERP usability also improves a plant s ability to measure performance. A best practice of the world s most efficient plants is to use graphs and time-series analysis to depict the strategic contributions of cells, teams, plants, functions, and other groups in increments as small as an hour. These measures roll up into daily, weekly, monthly, and annual strategic performance measures, such as speed, quality, cost, productivity, and financial returns. Contrary to creating a big brother culture, capturing performance measures on an ongoing basis motivates individuals because they have real-time visibility into how their contributions influence plant and company performance and how they can fix lapses and bridge gaps. Unfortunately, 70% of manufacturers have, at best, only occasional capture of operations knowledge/experiences, such as process improvements, that can be used to improve operations. In addition, many manufacturers fail to provide employees senior staff to frontline workers the information they need to evaluate the effectiveness of returns from their company s strategic efforts. For example, only 19% of manufacturers report regular monitoring and review of company-specific metrics by CEO and senior staff and transparency and clarity throughout the organization for reviewing returns from process improvements and that is the strategy getting the most measurement attention by manufacturers (Figure 1) Next Generation Manufacturing Study, The MPI Group. 2 Usability Drives Profitability / The MPI Group

3 Figure 1. Measurement systems for reviewing returns from six manufacturing strategies Customer-focused Human-capital Process Supply-chain Global innovation management improvement management Sustainability engagement No measurement system per se or reviews 18.5% 22.4% 10.6% 16.9% 32.5% 46.8% Ad hoc monitoring of basic measures and ad hoc reviews Company-specific metrics monitored regularly by operations staff Regular monitoring and review of companyspecific metrics by CEO and senior staff Regular monitoring and review of companyspecific metrics by CEO and senior staff and transparency and clarity throughout the organization 33.4% 36.0% 28.5% 32.0% 31.4% 21.6% 13.0% 18.7% 23.1% 21.9% 16.1% 10.0% 21.5% 17.0% 18.5% 23.0% 14.5% 15.0% 13.6% 6.0% 19.3% 6.3% 5.5% 6.7% Supporting Continuous Operations Also driving the demand for better ERP usability is new thinking on IT return on investment (ROI). In a competitive global economy, investors and corporate leaders won t tolerate lengthy software implementations that disrupt daily operations and cash flow. Leaders also increasingly favor investments that quickly add lasting advantage through innovation. In today s data-rich world this usually means improving access to knowledge and insight, rather than adding labor. Manufacturers also want more usable ERP solutions because they employ fewer people overall, and require smaller IT support staffs. To keep daily operations running smoothly, many tasks previously performed by IT are being handled by frontline staff. Production teams need ERP solutions with consumer-like system navigation and self-service features, such as report-writing. Vendors realize they must make investments to reduce the complexity of ERP and make it more usable for end users, says Rebecca Wettermann, Vice President of Nucleus Research. It s not just doing mobile, but making mobile more intuitive. It s not just adding new features, but really thinking about making the user interface more user friendly. Nobody is making their ERP decisions based on a long, detailed feature-and-function checklist anymore. They re really looking for how to get more value out of it Next Generation Manufacturing Study 4 All, Ann, Top ERP Trend? Usability, Says Nucleus Research, EnterpriseAppsToday.com, Jan. 9, Usability Drives Profitability / The MPI Group 3

4 Improved ERP functionality also provides an advantage in recruiting, leveraging, and retaining talent. As manufacturing professionals retire, the younger workers replacing them bring heightened expectations for enterprise software: easy-to-use tools that encourage continuous improvement and learning, and immediacy in decision-making and action. They want the speed of texting, the clarity of instant photo-sharing, and the intuitiveness of an app. Improved ERP functionality also provides an advantage in recruiting, leveraging, and retaining talent. For millennials, technology has always been a way to get things done faster and more efficiently, notes Cruxial CIO.com technology writer Amy Lee. Overall, these workers expect instant results from the tools they employ and want to take advantage of connectivity that allows users to work anywhere, from any device. 5 What s the cost of low worker engagement with a legacy ERP system? Lower efficiency and stymied growth, to start with. Columbus estimates that manufacturers with 60% adoption of their ERP systems (inclusive of their senior management and executives) are gaining greater insight into how customer forecasts and requirements impact production. More complex selling strategies including quoteto-cash, quote-to-order, and contract management become possible when there s greater ERP system adoption as well. Assessment: Does Your Company Need Better ERP Usability? To determine if your ERP system is as usable as it needs to be, look first at the front-end user interface. You should see: Familiar-looking interfaces, dashboards, and communication tools like those used by consumer websites and social-media communities. Navigation tools that allow diverse functionality without adding complexity. Role-based pull capability to access critical data quickly, regardless of the function utilizing that data. Immediate digital documentation and tagging of conversations, actions, and results. Robust and rapid search functionality From a planning perspective, the system should scale according to need and support global expansion (multilanguage, reporting variation, compliance variation, etc.). Flexibility is an important part of usability and makes mergers, new product introductions, and other large-scale changes less disruptive and costly while shortening the timeline to resulting gains. 5 Lee, Amy, Can Enterprises Act More Like Millenials? CruxialCIO.com, Jan. 22, Usability Drives Profitability / The MPI Group

5 Functionally, the system should be inclusive without slowing the performance of power users, and upgrades and enhancements should be painless and seamless. It can be run on remote servers and/or be sold as SaaS, but even traditional ERP suppliers are emphasizing usability by increasing their pace of new releases. The growing popularity of cloud computing is one reason traditional ERP suppliers are tweaking their offerings, says Wettermann of Nucleus Research. But also just the nature of the market is changing in that everyone now has an appetite for taking advantage of new capabilities on a more rolling, iterative basis. This is dramatically different than the forklift, 18-month type of deployments we ve seen in the past. 6 Conclusion ERP remains a foundational element of sound manufacturing management, but new technologies and management models, the competitive pressures of globalization, and changes in employee expectations are driving demands for better usability. Whether manufacturers enhance existing systems or invest in new ones, assessing ERP for usability is a must to maximize growth and profitability improvements. About The MPI Group The MPI Group serves leaders with research, advice, and performance-targeted solutions that provide a competitive advantage in today s fierce marketplace. MPI combines the disciplines of research, strategic advice, knowledge development, and hands-on leadership to create a difference in performance, in profits, and in the people who make them possible. Usability Drives Profitability / The MPI Group 5